For Workers: Higher Health-Care Costs On the Way

Most employers are planning to shift health-care costs to their employees in 2013 to help offset rising premiums, according to preliminary findings from Mercer’s annual health benefits survey, scheduled to be released in November.

In all, 58% of employers—a mix of large, medium and small—said they plan to increase employee contributions next year, continuing a trend that has persisted since 2005, according to the study, which has polled 2,000 employers since July. Prior to that, generally only one-third of employers said they planned to shift costs, according to Beth Umland, Mercer’s research director for health and benefits.

Having employees shoulder more of the burden will help employers bring down their average projected increase in health-care costs to 6.5%, from 8%, the study found.

Umland says cost-shifting has become a popular tactic among employers. Payroll deduction is one approach, while another is to usher employees into higher-deductible plans, which are less expensive for the company, she adds.

These changes have helped keep cost increases hovering around 6%, which appears to be the “threshold of pain” for most employers since 2005, Umland adds.

A growing number of companies are also turning to health and fitness management programs as a way to reduce health-care costs among employees, she says. Such programs were cited as the top cost-management tactic among employers in the survey. The idea is that in the long run, this will produce a healthier workforce, resulting in fewer sick days and smaller medical bills.

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